3/27 Adjustable Rate Mortgage - Example

A 3/27 is often a subprime mortgage that may have higher rates and depending on where you live may have a prepayment penalty. The 3 refers to the number of years that the loan is fixed while the 27 refers to the number of years that the loan is adjustable after that. So a 3/27 mortgage is usually due in 30 years. Typically they may adjust every 6 months after the initial fixed period expires.

In this example, we look at 3/27 mortgage for $210,000 with a starting interest rate of 8.25%. It has a 3% cap on the first adjustment and a 1% cap on each additional adjustment. It has a minimum interest rate equal to the start rate and a lifetime maximum interest rate of 14.25%. The index and margin are 5.34% and 3% respectively.

Use the adjustable rate mortgage calculator to explore how your interest rate and payment can change.

Adjustable Rate Calculator
Note that the fully indexed rate (i.e. index plus margin) is more than the start rate so even if the index rate remains stable the interest rate will increase after two years and you would end up paying $362,037 in total interest.
 Stable
MonthInterest
Rate
Index
Rate
Payment Interest Principal Balance
18.250%5.340%$1,578$1,444$134$209,866
28.250%5.340%$1,578$1,443$135$209,731
38.250%5.340%$1,578$1,442$136$209,596
48.250%5.340%$1,578$1,441$137$209,459
58.250%5.340%$1,578$1,440$138$209,321
68.250%5.340%$1,578$1,439$139$209,183
78.250%5.340%$1,578$1,438$140$209,043
88.250%5.340%$1,578$1,437$140$208,903
98.250%5.340%$1,578$1,436$141$208,761
108.250%5.340%$1,578$1,435$142$208,619
118.250%5.340%$1,578$1,434$143$208,475
128.250%5.340%$1,578$1,433$144$208,331
Year 1  $18,932$17,263$1,669 
138.250%5.340%$1,578$1,432$145$208,186
148.250%5.340%$1,578$1,431$146$208,039
158.250%5.340%$1,578$1,430$147$207,892
168.250%5.340%$1,578$1,429$148$207,743
178.250%5.340%$1,578$1,428$149$207,594
188.250%5.340%$1,578$1,427$150$207,443
198.250%5.340%$1,578$1,426$151$207,292
208.250%5.340%$1,578$1,425$153$207,139
218.250%5.340%$1,578$1,424$154$206,986
228.250%5.340%$1,578$1,423$155$206,831
238.250%5.340%$1,578$1,422$156$206,676
248.250%5.340%$1,578$1,421$157$206,519
Year 2  $18,932$17,120$1,812 
258.250%5.340%$1,578$1,420$158$206,361
268.250%5.340%$1,578$1,419$159$206,202
278.250%5.340%$1,578$1,418$160$206,042
288.250%5.340%$1,578$1,417$161$205,881
298.250%5.340%$1,578$1,415$162$205,719
308.250%5.340%$1,578$1,414$163$205,555
318.250%5.340%$1,578$1,413$164$205,391
328.250%5.340%$1,578$1,412$166$205,225
338.250%5.340%$1,578$1,411$167$205,058
348.250%5.340%$1,578$1,410$168$204,891
358.250%5.340%$1,578$1,409$169$204,722
368.250%5.340%$1,578$1,407$170$204,551
Year 3  $18,932$16,965$1,967 
378.340%5.340%$1,590$1,422$169$204,383
388.340%5.340%$1,590$1,420$170$204,213
398.340%5.340%$1,590$1,419$171$204,042
408.340%5.340%$1,590$1,418$172$203,870
418.340%5.340%$1,590$1,417$173$203,696
428.340%5.340%$1,590$1,416$175$203,522
438.340%5.340%$1,590$1,414$176$203,346
448.340%5.340%$1,590$1,413$177$203,169
458.340%5.340%$1,590$1,412$178$202,991
468.340%5.340%$1,590$1,411$179$202,811
478.340%5.340%$1,590$1,410$181$202,631
488.340%5.340%$1,590$1,408$182$202,449
Year 4  $19,083$16,980$2,103 
498.340%5.340%$1,590$1,407$183$202,266
508.340%5.340%$1,590$1,406$184$202,081
518.340%5.340%$1,590$1,404$186$201,895
528.340%5.340%$1,590$1,403$187$201,708
538.340%5.340%$1,590$1,402$188$201,520
548.340%5.340%$1,590$1,401$190$201,330
558.340%5.340%$1,590$1,399$191$201,139
568.340%5.340%$1,590$1,398$192$200,947
578.340%5.340%$1,590$1,397$194$200,753
588.340%5.340%$1,590$1,395$195$200,558
598.340%5.340%$1,590$1,394$196$200,362
608.340%5.340%$1,590$1,393$198$200,164
Year 5  $19,083$16,798$2,285 
618.340%5.340%$1,590$1,391$199$199,965
628.340%5.340%$1,590$1,390$200$199,764
638.340%5.340%$1,590$1,388$202$199,562
648.340%5.340%$1,590$1,387$203$199,359
658.340%5.340%$1,590$1,386$205$199,154
668.340%5.340%$1,590$1,384$206$198,948
678.340%5.340%$1,590$1,383$208$198,741
688.340%5.340%$1,590$1,381$209$198,532
698.340%5.340%$1,590$1,380$210$198,321
708.340%5.340%$1,590$1,378$212$198,109
718.340%5.340%$1,590$1,377$213$197,896
728.340%5.340%$1,590$1,375$215$197,681
Year 6  $19,083$16,600$2,483 
738.340%5.340%$1,590$1,374$216$197,465
748.340%5.340%$1,590$1,372$218$197,247
758.340%5.340%$1,590$1,371$219$197,028
768.340%5.340%$1,590$1,369$221$196,807
778.340%5.340%$1,590$1,368$222$196,584
788.340%5.340%$1,590$1,366$224$196,360
798.340%5.340%$1,590$1,365$226$196,135
808.340%5.340%$1,590$1,363$227$195,908
818.340%5.340%$1,590$1,362$229$195,679
828.340%5.340%$1,590$1,360$230$195,449
838.340%5.340%$1,590$1,358$232$195,217
848.340%5.340%$1,590$1,357$233$194,983
Year 7  $19,083$16,385$2,698 
858.340%5.340%$1,590$1,355$235$194,748
868.340%5.340%$1,590$1,354$237$194,511
878.340%5.340%$1,590$1,352$238$194,273
888.340%5.340%$1,590$1,350$240$194,033
898.340%5.340%$1,590$1,349$242$193,791
908.340%5.340%$1,590$1,347$243$193,548
918.340%5.340%$1,590$1,345$245$193,303
928.340%5.340%$1,590$1,343$247$193,056
938.340%5.340%$1,590$1,342$249$192,807
948.340%5.340%$1,590$1,340$250$192,557
958.340%5.340%$1,590$1,338$252$192,305
968.340%5.340%$1,590$1,337$254$192,051
Year 8  $19,083$16,151$2,932 
978.340%5.340%$1,590$1,335$255$191,796
988.340%5.340%$1,590$1,333$257$191,539
998.340%5.340%$1,590$1,331$259$191,280
1008.340%5.340%$1,590$1,329$261$191,019
1018.340%5.340%$1,590$1,328$263$190,756
1028.340%5.340%$1,590$1,326$264$190,492
1038.340%5.340%$1,590$1,324$266$190,225
1048.340%5.340%$1,590$1,322$268$189,957
1058.340%5.340%$1,590$1,320$270$189,687
1068.340%5.340%$1,590$1,318$272$189,415
1078.340%5.340%$1,590$1,316$274$189,141
1088.340%5.340%$1,590$1,315$276$188,866
Year 9  $19,083$15,897$3,186 
1098.340%5.340%$1,590$1,313$278$188,588
1108.340%5.340%$1,590$1,311$280$188,308
1118.340%5.340%$1,590$1,309$282$188,027
1128.340%5.340%$1,590$1,307$283$187,743
1138.340%5.340%$1,590$1,305$285$187,458
1148.340%5.340%$1,590$1,303$287$187,171
1158.340%5.340%$1,590$1,301$289$186,881
1168.340%5.340%$1,590$1,299$291$186,590
1178.340%5.340%$1,590$1,297$293$186,296
1188.340%5.340%$1,590$1,295$295$186,001
1198.340%5.340%$1,590$1,293$298$185,703
1208.340%5.340%$1,590$1,291$300$185,404
Year 10  $19,083$15,621$3,462 
1218.340%5.340%$1,590$1,289$302$185,102
1228.340%5.340%$1,590$1,286$304$184,798
1238.340%5.340%$1,590$1,284$306$184,492
1248.340%5.340%$1,590$1,282$308$184,184
1258.340%5.340%$1,590$1,280$310$183,874
1268.340%5.340%$1,590$1,278$312$183,562
1278.340%5.340%$1,590$1,276$314$183,247
1288.340%5.340%$1,590$1,274$317$182,931
1298.340%5.340%$1,590$1,271$319$182,612
1308.340%5.340%$1,590$1,269$321$182,291
1318.340%5.340%$1,590$1,267$323$181,967
1328.340%5.340%$1,590$1,265$326$181,642
Year 11  $19,083$15,321$3,762 
1338.340%5.340%$1,590$1,262$328$181,314
1348.340%5.340%$1,590$1,260$330$180,984
1358.340%5.340%$1,590$1,258$332$180,651
1368.340%5.340%$1,590$1,256$335$180,317
1378.340%5.340%$1,590$1,253$337$179,979
1388.340%5.340%$1,590$1,251$339$179,640
1398.340%5.340%$1,590$1,248$342$179,298
1408.340%5.340%$1,590$1,246$344$178,954
1418.340%5.340%$1,590$1,244$347$178,608
1428.340%5.340%$1,590$1,241$349$178,259
1438.340%5.340%$1,590$1,239$351$177,907
1448.340%5.340%$1,590$1,236$354$177,554
Year 12  $19,083$14,995$4,088 
1458.340%5.340%$1,590$1,234$356$177,197
1468.340%5.340%$1,590$1,232$359$176,839
1478.340%5.340%$1,590$1,229$361$176,477
1488.340%5.340%$1,590$1,227$364$176,114
1498.340%5.340%$1,590$1,224$366$175,747
1508.340%5.340%$1,590$1,221$369$175,379
1518.340%5.340%$1,590$1,219$371$175,007
1528.340%5.340%$1,590$1,216$374$174,633
1538.340%5.340%$1,590$1,214$377$174,257
1548.340%5.340%$1,590$1,211$379$173,878
1558.340%5.340%$1,590$1,208$382$173,496
1568.340%5.340%$1,590$1,206$384$173,111
Year 13  $19,083$14,641$4,442 
1578.340%5.340%$1,590$1,203$387$172,724
1588.340%5.340%$1,590$1,200$390$172,334
1598.340%5.340%$1,590$1,198$393$171,942
1608.340%5.340%$1,590$1,195$395$171,547
1618.340%5.340%$1,590$1,192$398$171,149
1628.340%5.340%$1,590$1,189$401$170,748
1638.340%5.340%$1,590$1,187$404$170,344
1648.340%5.340%$1,590$1,184$406$169,938
1658.340%5.340%$1,590$1,181$409$169,529
1668.340%5.340%$1,590$1,178$412$169,117
1678.340%5.340%$1,590$1,175$415$168,702
1688.340%5.340%$1,590$1,172$418$168,284
Year 14  $19,083$14,256$4,827 
1698.340%5.340%$1,590$1,170$421$167,863
1708.340%5.340%$1,590$1,167$424$167,440
1718.340%5.340%$1,590$1,164$427$167,013
1728.340%5.340%$1,590$1,161$430$166,584
1738.340%5.340%$1,590$1,158$432$166,151
1748.340%5.340%$1,590$1,155$436$165,716
1758.340%5.340%$1,590$1,152$439$165,277
1768.340%5.340%$1,590$1,149$442$164,836
1778.340%5.340%$1,590$1,146$445$164,391
1788.340%5.340%$1,590$1,143$448$163,943
1798.340%5.340%$1,590$1,139$451$163,492
1808.340%5.340%$1,590$1,136$454$163,038
Year 15  $19,083$13,837$5,246 
1818.340%5.340%$1,590$1,133$457$162,581
1828.340%5.340%$1,590$1,130$460$162,121
1838.340%5.340%$1,590$1,127$464$161,658
1848.340%5.340%$1,590$1,124$467$161,191
1858.340%5.340%$1,590$1,120$470$160,721
1868.340%5.340%$1,590$1,117$473$160,248
1878.340%5.340%$1,590$1,114$477$159,771
1888.340%5.340%$1,590$1,110$480$159,291
1898.340%5.340%$1,590$1,107$483$158,808
1908.340%5.340%$1,590$1,104$487$158,321
1918.340%5.340%$1,590$1,100$490$157,832
1928.340%5.340%$1,590$1,097$493$157,338
Year 16  $19,083$13,383$5,700 
1938.340%5.340%$1,590$1,094$497$156,841
1948.340%5.340%$1,590$1,090$500$156,341
1958.340%5.340%$1,590$1,087$504$155,838
1968.340%5.340%$1,590$1,083$507$155,330
1978.340%5.340%$1,590$1,080$511$154,820
1988.340%5.340%$1,590$1,076$514$154,305
1998.340%5.340%$1,590$1,072$518$153,788
2008.340%5.340%$1,590$1,069$521$153,266
2018.340%5.340%$1,590$1,065$525$152,741
2028.340%5.340%$1,590$1,062$529$152,212
2038.340%5.340%$1,590$1,058$532$151,680
2048.340%5.340%$1,590$1,054$536$151,144
Year 17  $19,083$12,889$6,194 
2058.340%5.340%$1,590$1,050$540$150,604
2068.340%5.340%$1,590$1,047$544$150,061
2078.340%5.340%$1,590$1,043$547$149,513
2088.340%5.340%$1,590$1,039$551$148,962
2098.340%5.340%$1,590$1,035$555$148,407
2108.340%5.340%$1,590$1,031$559$147,848
2118.340%5.340%$1,590$1,028$563$147,286
2128.340%5.340%$1,590$1,024$567$146,719
2138.340%5.340%$1,590$1,020$571$146,149
2148.340%5.340%$1,590$1,016$575$145,574
2158.340%5.340%$1,590$1,012$579$144,996
2168.340%5.340%$1,590$1,008$583$144,413
Year 18  $19,083$12,352$6,731 
2178.340%5.340%$1,590$1,004$587$143,826
2188.340%5.340%$1,590$1,000$591$143,236
2198.340%5.340%$1,590$995$595$142,641
2208.340%5.340%$1,590$991$599$142,042
2218.340%5.340%$1,590$987$603$141,439
2228.340%5.340%$1,590$983$607$140,832
2238.340%5.340%$1,590$979$611$140,220
2248.340%5.340%$1,590$975$616$139,605
2258.340%5.340%$1,590$970$620$138,985
2268.340%5.340%$1,590$966$624$138,360
2278.340%5.340%$1,590$962$629$137,732
2288.340%5.340%$1,590$957$633$137,099
Year 19  $19,083$11,769$7,314 
2298.340%5.340%$1,590$953$637$136,461
2308.340%5.340%$1,590$948$642$135,819
2318.340%5.340%$1,590$944$646$135,173
2328.340%5.340%$1,590$939$651$134,522
2338.340%5.340%$1,590$935$655$133,867
2348.340%5.340%$1,590$930$660$133,207
2358.340%5.340%$1,590$926$664$132,543
2368.340%5.340%$1,590$921$669$131,874
2378.340%5.340%$1,590$917$674$131,200
2388.340%5.340%$1,590$912$678$130,521
2398.340%5.340%$1,590$907$683$129,838
2408.340%5.340%$1,590$902$688$129,150
Year 20  $19,083$11,135$7,948 
2418.340%5.340%$1,590$898$693$128,458
2428.340%5.340%$1,590$893$697$127,760
2438.340%5.340%$1,590$888$702$127,058
2448.340%5.340%$1,590$883$707$126,351
2458.340%5.340%$1,590$878$712$125,639
2468.340%5.340%$1,590$873$717$124,922
2478.340%5.340%$1,590$868$722$124,200
2488.340%5.340%$1,590$863$727$123,473
2498.340%5.340%$1,590$858$732$122,740
2508.340%5.340%$1,590$853$737$122,003
2518.340%5.340%$1,590$848$742$121,261
2528.340%5.340%$1,590$843$747$120,513
Year 21  $19,083$10,446$8,637 
2538.340%5.340%$1,590$838$753$119,761
2548.340%5.340%$1,590$832$758$119,003
2558.340%5.340%$1,590$827$763$118,240
2568.340%5.340%$1,590$822$768$117,471
2578.340%5.340%$1,590$816$774$116,697
2588.340%5.340%$1,590$811$779$115,918
2598.340%5.340%$1,590$806$785$115,133
2608.340%5.340%$1,590$800$790$114,343
2618.340%5.340%$1,590$795$796$113,548
2628.340%5.340%$1,590$789$801$112,747
2638.340%5.340%$1,590$784$807$111,940
2648.340%5.340%$1,590$778$812$111,128
Year 22  $19,083$9,697$9,386 
2658.340%5.340%$1,590$772$818$110,310
2668.340%5.340%$1,590$767$824$109,486
2678.340%5.340%$1,590$761$829$108,657
2688.340%5.340%$1,590$755$835$107,822
2698.340%5.340%$1,590$749$841$106,981
2708.340%5.340%$1,590$744$847$106,134
2718.340%5.340%$1,590$738$853$105,282
2728.340%5.340%$1,590$732$859$104,423
2738.340%5.340%$1,590$726$865$103,559
2748.340%5.340%$1,590$720$871$102,688
2758.340%5.340%$1,590$714$877$101,812
2768.340%5.340%$1,590$708$883$100,929
Year 23  $19,083$8,884$10,199 
2778.340%5.340%$1,590$701$889$100,040
2788.340%5.340%$1,590$695$895$99,145
2798.340%5.340%$1,590$689$901$98,244
2808.340%5.340%$1,590$683$907$97,336
2818.340%5.340%$1,590$676$914$96,423
2828.340%5.340%$1,590$670$920$95,503
2838.340%5.340%$1,590$664$927$94,576
2848.340%5.340%$1,590$657$933$93,643
2858.340%5.340%$1,590$651$939$92,704
2868.340%5.340%$1,590$644$946$91,758
2878.340%5.340%$1,590$638$953$90,805
2888.340%5.340%$1,590$631$959$89,846
Year 24  $19,083$8,000$11,083 
2898.340%5.340%$1,590$624$966$88,880
2908.340%5.340%$1,590$618$973$87,908
2918.340%5.340%$1,590$611$979$86,928
2928.340%5.340%$1,590$604$986$85,942
2938.340%5.340%$1,590$597$993$84,949
2948.340%5.340%$1,590$590$1,000$83,950
2958.340%5.340%$1,590$583$1,007$82,943
2968.340%5.340%$1,590$576$1,014$81,929
2978.340%5.340%$1,590$569$1,021$80,908
2988.340%5.340%$1,590$562$1,028$79,880
2998.340%5.340%$1,590$555$1,035$78,845
3008.340%5.340%$1,590$548$1,042$77,803
Year 25  $19,083$7,040$12,043 
3018.340%5.340%$1,590$541$1,050$76,753
3028.340%5.340%$1,590$533$1,057$75,696
3038.340%5.340%$1,590$526$1,064$74,632
3048.340%5.340%$1,590$519$1,072$73,561
3058.340%5.340%$1,590$511$1,079$72,482
3068.340%5.340%$1,590$504$1,086$71,395
3078.340%5.340%$1,590$496$1,094$70,301
3088.340%5.340%$1,590$489$1,102$69,200
3098.340%5.340%$1,590$481$1,109$68,090
3108.340%5.340%$1,590$473$1,117$66,973
3118.340%5.340%$1,590$465$1,125$65,848
3128.340%5.340%$1,590$458$1,133$64,716
Year 26  $19,083$5,996$13,087 
3138.340%5.340%$1,590$450$1,140$63,575
3148.340%5.340%$1,590$442$1,148$62,427
3158.340%5.340%$1,590$434$1,156$61,271
3168.340%5.340%$1,590$426$1,164$60,106
3178.340%5.340%$1,590$418$1,173$58,934
3188.340%5.340%$1,590$410$1,181$57,753
3198.340%5.340%$1,590$401$1,189$56,564
3208.340%5.340%$1,590$393$1,197$55,367
3218.340%5.340%$1,590$385$1,205$54,162
3228.340%5.340%$1,590$376$1,214$52,948
3238.340%5.340%$1,590$368$1,222$51,725
3248.340%5.340%$1,590$359$1,231$50,495
Year 27  $19,083$4,862$14,221 
3258.340%5.340%$1,590$351$1,239$49,255
3268.340%5.340%$1,590$342$1,248$48,007
3278.340%5.340%$1,590$334$1,257$46,751
3288.340%5.340%$1,590$325$1,265$45,486
3298.340%5.340%$1,590$316$1,274$44,211
3308.340%5.340%$1,590$307$1,283$42,928
3318.340%5.340%$1,590$298$1,292$41,636
3328.340%5.340%$1,590$289$1,301$40,336
3338.340%5.340%$1,590$280$1,310$39,026
3348.340%5.340%$1,590$271$1,319$37,707
3358.340%5.340%$1,590$262$1,328$36,378
3368.340%5.340%$1,590$253$1,337$35,041
Year 28  $19,083$3,629$15,454 
3378.340%5.340%$1,590$244$1,347$33,694
3388.340%5.340%$1,590$234$1,356$32,338
3398.340%5.340%$1,590$225$1,366$30,973
3408.340%5.340%$1,590$215$1,375$29,598
3418.340%5.340%$1,590$206$1,385$28,213
3428.340%5.340%$1,590$196$1,394$26,819
3438.340%5.340%$1,590$186$1,404$25,415
3448.340%5.340%$1,590$177$1,414$24,002
3458.340%5.340%$1,590$167$1,423$22,578
3468.340%5.340%$1,590$157$1,433$21,145
3478.340%5.340%$1,590$147$1,443$19,702
3488.340%5.340%$1,590$137$1,453$18,248
Year 29  $19,083$2,290$16,793 
3498.340%5.340%$1,590$127$1,463$16,785
3508.340%5.340%$1,590$117$1,474$15,311
3518.340%5.340%$1,590$106$1,484$13,827
3528.340%5.340%$1,590$96$1,494$12,333
3538.340%5.340%$1,590$86$1,505$10,829
3548.340%5.340%$1,590$75$1,515$9,314
3558.340%5.340%$1,590$65$1,526$7,788
3568.340%5.340%$1,590$54$1,536$6,252
3578.340%5.340%$1,590$43$1,547$4,705
3588.340%5.340%$1,590$33$1,558$3,148
3598.340%5.340%$1,590$22$1,568$1,579
3608.340%5.340%$1,590$11$1,579$0
Year 30  $19,083$835$18,248 
Grand
Total
    $572,037 $362,037 $210,000 

Mortgage Calculator - Help

Amortization Schedule
The amortization schedule show you how monthly principal and interest payment and principal balances change over the life of your loan.
Floor Rate
Floor rate is the minimum interest rate for an adjustable rate mortgage (ARM).
Index Rate
Rate Adjustment on ARMs are based on the index rate, the margin, the adjustment schedule, interest rate caps, and floor rate specified in your loan documents. Index rates change over time. They should be published and widely available. Common indexes used for setting mortgage rates have include the Prime Rate, Libor (London Interbank Offer Rate) and U.S. Treasury Rates.
Interest
The portion of your mortgage payment that is due to the interest rate being applied to the principal balance. The Total Interest for a mortgage is the sum of all interest paid over the life of a loan.
Interest Rate Adjustments
The interest rate changes on an adjustable rate mortage (ARM) during adjustment periods specified in your loan documents. Your interest rate may have a fixed period where it does not change followed by adjustements on a regularly scheduled basis. For example, the interest rate on a mortgage could be fixed for 2 years followed by adjustments every 6 months.
Interest Rate Caps
Limits how much your interest rate can be increased during each adjustment period for an ARM. The cap for the first adjustment period may be different than the cap on subsequent adjustments. There also may be a maximim overall cap on interest rate increases during the life of your loan.
Interest Rate Scenarios
To decide if an adjustable rate mortgage is right for you, you should how changes in interest rates will effect the mortgage. The adjustable rate mortgage calculator shows you how your payment changes in the best case where rates are set at the minimum for your mortgage, the worst case where rates are set at the maximum for your mortgage, and the stable case where rates remain constant for your mortgage.
Loan Amount
The initial principal balance or your mortgage at closing.
Margin
When an ARM adjusts the margin is added to the index rate to help determine your interest rate. Interest rate caps and the floor rate for your mortgage may limit how much your actual interest rate changes. The margin typically is fixed for the life of the loan. It should be clearly specified in your loan documents.
Payment Shock
Occurs when the required minimum payment for a mortgage increases significantly. This can occur on adjustable rate mortgage when interest rates rise sharply, on interest-only mortgages when the interest-only period ends, and on balloon mortgages when the balloon payment is due.
Principal
The portion of your mortgage payment that is used to pay down the current balance of your mortgage. The principal balance represents how much you owe on the mortgage.
Start Rate
The initial interest rate on an Adjustable Rate Mortgage.
Term
The amortization term is one of the key factors that determine your required mortgage payment. Your required mortgage payment for fully amortizing mortgages is the amount that would result in the mortgage being closest to being paid off by the end of the amortization term. Longer amortization terms result in lower required mortgage payments for fully amortizating mortgages, all other things being equal.